Indian Hotels demands apology from Orient-Express for 'libelous' rejection letter

By Lisa Kerner

Charlotte, N.C., Dec. 19 - Indian Hotels Co. Ltd. said it found Orient-Express Hotels Ltd.'s Dec. 10 letter in response to its bid to combine the companies "unduly aggressive" and suggested the letter was written by an "over-zealous advisor."

Indian Hotels' R.K. Krishna Kumar, in a Dec. 19 letter to Orient-Express president Paul White, said he found the letter to be "pejorative, inaccurate and libelous."

Kumar's letter was included in a schedule 13D filing with the Securities and Exchange Commission.

As previously reported, Orient-Express said it had no interest in pursuing the shareholder's proposals, despite Indian Hotels' 11.5% ownership of the company. The company said the proposal lacked a strategic fit and could possibly reduce the value of the Orient-Express brand.

In an attempt to "set the record straight," Kumar said in his letter that Indian Hotels:

• Had a specific proposal on the table to acquire Orient-Express;

• Acquired an 11.5% ownership stake in Orient-Express "to have a serious and credible foundation for discussions" with the company's board; and

• Never sought to compromise the independence of Orient-Express.

Indian Hotels believes that Orient-Express has an entrenched board and management that does not meet the needs of its shareholders or "respect the most basic tenets of corporate governance," the letter stated.

Kumar asked Orient-Hotels to immediately publish a formal apology to Indian Hotels "using the same channels" it used to publicize its letter to Indian Hotels and including posting the apology on Orient-Express' global web site.

Hamilton, Bermuda-based Orient-Express owns and operates deluxe hotels, restaurants, tourist trains and river cruise businesses.

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